N Korea to pull workers from industrial zone

AFP, SEOUL

Tue, Apr 09, 2013 - Page 1

North Korea said yesterday it was withdrawing all workers and suspending operations at a lucrative joint industrial zone with South Korea, blaming foreign “warmongers” at a time of acute tensions.

The announcement came amid reports of heightened activity at the North’s nuclear test site, and at a missile battery, although the South Korean government denied suggestions that a fourth nuclear test was imminent.

North Korea “will withdraw all its employees” from the Kaesong industrial zone, Kim Yang-gon, a senior North Korean ruling party official, said in a statement carried by the North’s official Korean Central News Agency.

Pyongyang would also “temporarily suspend the operations in the zone and examine the issue of whether it will allow its existence or close it,” Kim said.

Kaesong was built in 2004 as a rare symbol of cross-border economic cooperation. It is a crucial hard currency source for the impoverished North, through taxes and revenues, and from the state’s cut from the workers’ wages.

Turnover in last year was reported at US$469.5 million, with accumulated turnover since 2004 standing at US$1.98 billion.

However, Pyongyang has blocked South Korean access to Kaesong since Wednesday last week, forcing 13 of the 123 South Korean firms operating to halt production.

Yesterday’s announcement came just hours after South Korean Minister of Finance Hyun Oh-seok denounced the access ban as “ridiculous.”

Pyongyang had threatened to withdraw its 53,000 workers last week after the South’s defense minister said there was a “military” contingency plan in place to ensure the safety of South Koreans.

“How the situation will develop in the days ahead will entirely depend on the attitude of the South Korean authorities,” said Kim, who blamed the pull-out on “military warmongers” who had affronted the North’s “dignity.”

The Korean Peninsula has been locked in a cycle of escalating military tensions since the North’s third nuclear test in February, which drew toughened UN sanctions.

The South’s Ministry of Defense said yesterday that activity detected at the North’s Punggye-ri atomic test site was “routine” and should not be interpreted as final preparation for another detonation.

“There is no indication that a nuclear test is imminent,” ministry spokesman Kim Min-seok said, while adding that the North consistently maintained Punggye-ri at a state of test-readiness.

The South’s minister of unification had appeared to confirm a report by the JoongAng Ilbo daily, which cited intelligence reports of stepped-up activity at the site. However, he then insisted his remarks had been misinterpreted.

North Korea’s bellicose rhetoric has reached fever pitch in recent weeks, with near-daily threats of attacks on US military bases and South Korea in response to ongoing South Korea-US military exercises.

Intelligence reports suggest Pyongyang has readied two mid-range missiles on mobile launchers on its east coast, and is aiming at a test-firing before the birthday of late founding North Korean leader Kim Il-sung on Monday.

A missile launch would be highly provocative, especially given the strong rebuke the North’s sole ally China delivered on Sunday.

“No one should be allowed to throw a region, even the whole world, into chaos for selfish gains,” Chinese President Xi Jinping (習近平) said.

The US, which has met the North’s threats with some military muscle-flexing of its own, offered a calibrated concession on Saturday by delaying a planned inter-continental ballistic missile test.

Russian President Vladimir Putin yesterday welcomed the decision to postpone the test, which the US had said it feared could be misconstrued as an attempt to exacerbate the air of crisis.